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There is a large group of United States unicorns — those valued at $1 billion or more — which are likely to go public in 2025, according to PitchBook/NVCA Venture Monitor For the fourth quarter of 2024.
The folks at PitchBook have a venture capital exit forecaster, a tool that leverages machine learning and PitchBook’s database of companies, funding rounds, and investors to objectively assess a startup’s likelihood of making a successful exit.
On the PitchBook platform, venture capital-backed companies are scored with a percentage on their likelihood of being acquired, going public, not exiting due to failure, or becoming self-sustaining. To provide a clearer picture of the true exit value of the venture capital market, the researchers added a proprietary extrapolation methodology currently used for undisclosed M&A transactions in our reports on private equity and global M&A.
“Although 2024 has seen a steady increase in completed financings and the total number of dollars invested, the proliferation of early-stage AI-focused transactions at mega valuations masks a problem,” Nizar Tarhouni, executive vice president of research and market intelligence at PitchBook, said in a statement. The broader enterprise industry continues to face corrective challenges.
Ultimately, he said, the venture capital landscape lacks meaningful exits, driven by a host of issues including buyer-seller mismatches caused by bloated pre-roll rounds and regulatory headwinds that stifle the appetite for deals in the bulk of the market.
“Our vision for 2025 is cautiously optimistic,” Tarhouni said. “More mergers and acquisitions and a business-friendly presence in Washington, along with more time for startups and investors to recalibrate expectations around valuations, deal structures and growth, may help attract more capital to exit the margins.” “However, fundraising may remain tepid, especially as other pockets of the market appear to be gaining traction, vying for dollars in dedicated alternatives buckets, ultimately favoring platforms.” Larger projects and established managers.”
After a strong quarter with the highest investment levels since mid-2022, there is a sense of cautious optimism for venture capital firms and entrepreneurs heading into 2025, NVCA CEO Bobby Franklin said in a statement.
“Changes in leadership at the FTC and DOJ could alleviate some of the liquidity challenges for portfolio companies, and changes at the SEC could correct the scale of regulatory burdens on companies,” he said. “With an increasing number of venture capital firms taking on government roles and actively participating on Capitol Hill, the venture industry has a unique opportunity to highlight the critical role of venture-backed companies in driving economic growth and maintaining American competitiveness.”
He said the tax bill currently making its way through Congress is of particular interest, with the potential to stimulate innovation, restore the R&D tax credit, and support the broader ecosystem.
Among U.S. technology companies ranked by IPO likelihood, PitchBook expects Anduril, an aerospace and defense company created by Oculus founder Palmer Luckey, to have a 97% chance of going public in 2025.
Another company with gaming roots is Mythical Games, a Web3 gaming company headed by John Linden. The company has a 97% chance of going public in 2025.
Others include Ayar Labs, Carbon, Databricks, EquipmentShare, Form Energy, GrubMarket, Mainspring, Sila, and StockX. Impossible Foods, Groq, and SpaceX are among the companies that have a 96% chance of going public.
In 2024, the largest category of deals by size was between $1 million and $5 million, with 3,153 startups in this category. This is down from 3,781 in 2023 and 5,310 in the peak year of 2021.
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